Canada Stocks: TSX rises for fourth day on supersized Fed rate cut bets
16/09/2024 21:19
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TSX ends up 0.6% at 23,702.07
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Posts record closing high
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Energy adds 1%; oil settles 2.1% higher
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Bausch Health Companies jumps 10.6%
(Updates at market close)
By Nikhil Sharma and Fergal Smith
Sept 16 (Reuters) - Canada's commodity-linked main stock
index rose to an all-time high on Monday, led by gains for
energy and technology shares, as expectations rose the Federal
Reserve would cut U.S. interest rates by half a percentage point
at a policy decision this week.
The Toronto Stock Exchange's S&P/TSX composite index
.GSPTSE ended up 133.42 points, or 0.6%, at 23,702.07, its
fourth straight day of gains and eclipsing the record closing
high it posted on Friday.
Futures on the fed funds rate have priced in a nearly 60%
chance of a 50 basis-point rate cut by the Fed on Wednesday,
rather than a quarter-point move, up from 45% last Friday.
"It's probably the first cut of many to come" and that gives
a boost to the resource-heavy Canadian market for a number of
reasons, said Allan Small, senior investment advisor at Allan
Small Financial Group with iA Private Wealth.
Zero-yielding gold and other dollar-denominated commodities
tend to benefit from lower U.S. interest rates. Gold XAU= rose
to a record high and oil CLc1 settled 2.1% higher at $70.09 a
barrel.
The energy group advanced 1%, heavily-weighted financials
added 0.7% and technology ended 1% higher.
Bausch Health Companies BHC.TO shares jumped 10.6% after a
report that its Bausch + Lomb BLCO.N unit was exploring sale
options.
Air Canada AC.TO shares gained 3.5% after the company said
on Sunday it has reached a tentative, last-minute deal with its
pilots' union over a new four-year collective agreement,
averting a near-term strike or lockout.
(Reporting by Fergal Smith in Toronto and Nikhil Sharma in
Bengaluru; Editing by Leroy Leo and Devika Syamnath)
((fergal.smith@thomsonreuters.com; +1 647 480 7446))